On the 28th of January, the Business Times ran a report entitled “Thai property can stay hot in chillier times”. It narrated the demand that is expected to come from the Chinese and how as the Chinese middle class continues to grow and accumulate wealth, the demand for property investments in Thailand will remain strong. These are the factors that will encourage the Chinese to invest in properties in Thailand, mainly Bangkok.
1) Thailand is considered a safe haven
In an era with great turmoil around the world and with the US and China embroiled in a trade war, Thailand is seen as a safe place to park their monies. The Thai Baht has proven to be very resilient over the past decade.
2) Benchmark interest rates are still low
Thailand’s benchmark interest rate is at 1.75 per cent and inflation is at about 0.4 per cent. This means that lending cost is low and this is a huge benefit for the construction industry. Mortgage rates for locals are very attractive. So much so that the Thai government needed to step in to regulate excessive risk-taking in the property market.
3) Tourism is still a very strong driver of the economy
Tourism contributes about one-fifth of Thailand’s Gross Domestic Product (GDP). Bangkok is still the world’s most visited city in the world, even ahead of cities like London.
4) The Thai government is expanding its visa-free entry policy for the Chinese
In a bid to entice the Chinese to visit Thailand, the Thai government implemented a visa-free entry policy for the Chinese. Now they are extending this policy till 30th April 2019. This waiver alone is expected to boost tourism by 30 per cent.
To read the full Business Times article, visit this link:
The team at Invest Bangkok Property is positive of price growth in the medium to long term. In the short term, due to external factors like a slowing global recession and repercussions of a trade war between the two largest economies in the world, we would recommend clients make property investments with a longer horizon. The elections should go along smoothly but if it does not, there is a chance that it will adversely affect the Thai economy. The Thai economy and correspondingly, the Thai Baht has been the standout performer in South East Asia in the past decade. For a narration of how strong the Thai Baht has been, you may refer to this article: My views on the Singapore and Bangkok property markets.
The Invest Bangkok Property editorial team